Move Over Mickey, Disney's Found a Franchise

By DAVE ITZKOFF; Brooks Barnes contributed reporting.

Published: August 20, 2007

CORRECTION APPENDED

When ''High School Musical 2,'' the sequel to the hit 2006 made-for-television movie, made its debut on the Disney Channel on Friday night, it was a highly anticipated moment for millions of children across the nation.

It was also a satisfying one for the Disney Channel and its parent, the Walt Disney Company. Despite lukewarm reviews, the film's debut drew 17.2 million viewers, according to preliminary ratings estimates from the channel. If those estimates hold up, it would make the debut of ''High School Musical 2'' the No. 1 television program of the week, on cable or network, as well as the most watched show of any kind in basic cable history.

The success of ''High School Musical 2'' is an indication of Disney's long-term efforts to reposition its cable channel to appeal to the underserved 9-to-14 age group and to rope in youngsters for whom Mickey Mouse seems too babyish. For the time being at least, the movie has made a trio of fictional high school students named Troy, Gabriella and Sharpay as recognizably Disney as that 79-year-old mouse.

Rich Ross, the president of Disney Channel Worldwide, argued that the ratings achievements of the sequel pointed to the larger strength of the channel's television movie business. He noted that ''High School Musical'' had been the channel's 61st original movie. ''People talk about 'High School Musical' as a franchise,'' he said. ''The franchise is the Disney Channel original movie.''

Nevertheless, sustaining interest in ''High School Musical'' required Disney and its promotional partners to bombard capricious young viewers with a relentless stream of merchandise and marketing in the 18 months between the first and second movies.

And now some analysts wonder if Disney is risking the health of this budding franchise by expanding it too quickly.

''It's all about how you steer the ship,'' said Matt Britton, chief of brand development for Mr. Youth, a New York marketing firm. ''You want to satisfy demand but not overdo it. They are coming right up to that line.''

From the moment the first ''High School Musical,'' a made-for-television, totally wholesome confection about a hunky jock and a cherubic straight-A girl who discover a mutual passion for performing, had its premiere in January 2006, a sequel was assured: the film made its debut to an audience of 7.8 million viewers, and generated $100 million in profits from DVD and soundtrack sales, touring concerts and ice shows, and numerous other brand extensions over the next two years.

The sequel continues the characters' adventures during a vacation at a New Mexico resort.

Virginia Heffernan, a television critic for The New York Times, wrote that although the sequel had a haphazard charm, ''the movie is mediocre, and should be skipped.'' But she added, ''I can't wait to buy the soundtrack and do the karaoke.''

When Mr. Ross joined the Disney Channel, in 1996, its prospects were not uniformly bright. As it tried to shift from being a premium service, the Disney Channel was best known for its cartoon shows -- and as a perpetual also-ran to its basic-cable rival Nickelodeon.

And when Mr. Ross and his colleague Anne Sweeney, now the president of the Disney-ABC Television Group, sought to create a Disney Channel line of made-for-television movies, they were second-guessed within their own company: the channel was already associated with a film studio that could supply it with theatrical releases. But with the R rating in ascendance and an emerging demographic of 9-to-14-year-olds craving pop culture to call their own, they persevered.

A decade later, the Disney Channel is now the biggest kid on the block: for two years, it has been the highest-rated basic cable channel among children 6 to 11 and 9 to 14. It is a sea change from 2000-1 when Nickelodeon had all of the Top 10 most-watched cable programs among children 6 to 14.

In the 18-month lead-up to ''High School Musical 2,'' Disney executives did not want to repeat their missteps with the original, when they were surprised by the degree of success: they did not have enough merchandise to sell the Monday morning after its premiere. And the cast was not yet signed for the sequel.

This time the channel subdivided its audience into the narrowest of niches and sought out each razor-thin slice wherever it could be found: cross-promotions were created with Major League Baseball, Wal-Mart, Sprint and Dannon yogurt, among others. Gossip and updates on the making of the sequel were doled out to magazines like CosmoGirl and People, and every star of the film had an official presence on YouTube, MySpace or elsewhere on the Internet -- a strategy that was largely absent from the promotion of the first film.

Even the gradual unveiling of the sequel's poster on the Disney.com Web site was turned into its own event. ''The poster was released in pieces,'' said Danielle Chiara, the deputy editor of J-14, a tween-oriented entertainment magazine. ''Every week you would see a piece from it, and then kids could print it out once it was entirely revealed.''

Meanwhile, a global marketing plan was devised for the movie, beginning with an almost-24-hour-long conference call between American executives at the Disney Channel and its partners in more than 100 countries. ''We started with India, and we ended with Australia,'' Mr. Ross said.

And, oh yes, there was merchandising, from apparel to pencil cases to melodic toothbrushes. Fans could choose from three different DVD versions, and at least as many soundtracks. Disney's Consumer Products group estimates that in the 2008 fiscal year ''High School Musical'' should generate some $650 million in retail sales.

Some observers of the fickle tween marketplace say they are surprised that ''High School Musical'' has been able to maintain its popularity as long as it has. ''It's taken over everything, and everybody's under the assumption that what goes up must come down,'' Ms. Chiara of J-14 said. ''But it's on such a height right now that I don't see that coming down happening any time soon.''

By now, even the franchise's most loyal fans are aware of how persistently ''High School Musical'' has been marketed to them.

''I always think that it's way too much,'' said Bridget Lavin, an 11-year-old from Manhasset, N.Y., wearing earrings in the shape of Mickey Mouse. ''That doesn't make me any less excited.''

And some of the parents who pay for all the merchandise say they do not mind, as long as it is in the service of something so squeaky clean.

''What can I complain about?'' said Andrea Doherty of Manhasset, the mother of two daughters, 10 and 13. ''In a regular teen movie, they'd be jumping all over each other and you'd have to bleep things out.''

There will be plenty of additional ''High School Musical'' products to put on wish lists in the months ahead.

And a third movie is in the works, a feature film that will make its debut in theaters in late 2008, once negotiations with principal cast members are complete.

Mr. Ross gave no sign that the film franchise will end as a trilogy, pointing to the Harry Potter series as his inspiration. ''You always feel pretty good when there's a number seven after their last sequel,'' he said, ''and a two after yours. If you do it right, maybe there's more to go.''

PHOTO: The premiere of ''High School Musical 2'' on Friday held Jacqueline Quinn, 6, in rapt attention. (PHOTOGRAPH BY OSCAR HIDALGO FOR THE NEW YORK TIMES)

Correction: August 24, 2007, Friday
A front-page article on Monday about the impact of the ''High School Musical'' movies on the fortunes of the Disney Channel referred imprecisely to the channel's current viewership among children 6 to 11 and 9 to 14. It is the highest-rated basic-cable channel for those age groups in prime time, not overall.